Managing the Launch: How to Keep Employees Enthusiastic and Engaged

Q: As much as I agree with you and think of you as a role model, I find some of your recommendations rather unrealistic, especially for bus

Q: As much as I agree with you and think of you as a role model, I find some of your recommendations rather unrealistic, especially for businesses just starting up.

For example, I would like to keep my employees happy and having fun, but find it a great challenge due to limited resources. I am not able to pay my employees well, nor provide a good working environment.

My priority right now is to make more money and turn this business into a reality. On the other hand, my employees want good salaries and to work in a slick environment. We have conflicting priorities, therefore I am forced to micromanage my staff to get results. Please advise what I should do to make my employees happy.

-Emily Bosco, Kenya

A: Emily brings up an interesting and challenging dilemma for entrepreneurs: During a business’s precarious launch stage, can one truly afford to be generous, foster an atmosphere of fun and caring, and give employees freedom?

It is not only realistic, but vital to your new business’s long-term success.

When I look back at our early days at Student magazine, I did not have much money to pay my staff or improve our premises. In fact, we worked in a basement flat, with the furniture limited to a few beanbag chairs and some desks and phones. But the thrill and promise of possible success united us and ensured that we all worked long hours in those cramped conditions. Despite the low pay, no one complained – everyone was intent on making the magazine work.

The same was true of our first Virgin companies – a mail-order business selling records, and later, a few record stores. Again, we tried to keep the vibe relaxed, maintaining small, uncomplicated and friendly offices. This decision paid off, attracting great team members who were drawn by the flexible working conditions and lively industry.

We always strove to create an atmosphere of team spirit and mutual appreciation. At Student, we had a party or at least a few drinks whenever a staffer brought in an important new advertising account, and we celebrated the publication of every edition. We tried to make sure everyone had a great time at work, which generated great loyalty.

My philosophy has not changed since then: Do something you enjoy and your enthusiasm will rub off on others, ensuring that you have a committed and spirited team. In fact, for more than 40 years, I have felt that one of my most important jobs is to attract and motivate great people who genuinely seem to feel that their job is more important than just money.

Emily talks about having to micromanage her team. I find this counterproductive: Employees will not take responsibility for their own actions if they feel the boss is looking over their shoulders all the time. They will not take the initiative to work that extra hour, make that extra call or squeeze that little bit more out of a negotiation.

The credit for Virgin’s enduring and varied success is often attributed to me, but it’s actually due to the people who piloted those businesses. My decision to give them autonomy and responsibility and encourage them to take risks has allowed us to grow in many directions while keeping costs down.

Giving my employees room to work has often meant my actually moving out of the business’s headquarters. In the early days I used a houseboat as my office, and later my home in Holland Park, in order to give my managers the space and authority to make their own decisions.

And when our music business was becoming too big and top-heavy in terms of management, we split it in two, to ensure everyone focused on music and not internal politics. We kept doing this until we had nine or 10 companies in West London, each in its own building. This helped us unearth great acts during the '70s and '80s, such as the Sex Pistols and Culture Club.

When things do go wrong, you must teach yourself to listen to your employees and encourage them to find solutions. If you are worried by the business’s finances, share this with your team and then listen to their suggestions for improving the situation. Your employees should never feel like hired hands, but your fellow entrepreneurs.

Finally, it sounds as though some employees are not working out at Emily’s business. If you find yourself in this situation, take a long, hard look at yourself and how you are treating your employees. Then look at your senior team (rot starts at the top), and whether direction is being effectively delivered. Letting people go should be your very last lever.

Managers should never rule by fear. I find enthusiasm, genuine openness and camaraderie with your people are far better. Successful entrepreneurs usually have excellent people skills that exponentially increase their ability to make things happen.

So remember: encourage, enthuse, try to make work fun. Practice these skills at your small business; work on them every day. If you do, perhaps you will someday have the opportunity to continue practicing – at your large business!